"Lutnick Defends Tether Amidst Scrutiny; Crypto Industry Faces Global Oversight"

Howard Lutnick, the nominee for U.S. Commerce Secretary, faced questions during a Senate Commerce Committee hearing about his firm Cantor Fitzgerald's custodial role for Tether, amidst ongoing scrutiny over the crypto token's reserves and alleged ties to illicit finance. Lutnick defended the stability of USDT and its backing, while addressing ongoing regulatory challenges and fines related to the token.

Tether, the company behind the USDT stablecoin, has been under scrutiny for its reserves and alleged ties to illicit finance. The U.S. Department of Justice and the Commodity Futures Trading Commission have both launched investigations into Tether's reserves and potential market manipulation. Lutnick, as the CEO of Cantor Fitzgerald, which serves as a custodian for Tether, was questioned about his firm's role in the matter.

Lutnick acknowledged the regulatory challenges and fines related to Tether, stating that the company is committed to working with regulators to address these issues. He also emphasized the stability of USDT and its backing, noting that the token is fully backed by a reserve of assets, including cash and cash equivalents, as well as other assets such as loans and investments.

The hearing comes as the crypto industry faces increased scrutiny from regulators worldwide. In the U.S., the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) have both stepped up their oversight of the crypto market, with the SEC recently creating a new crypto task force led by Commissioner Hester Peirce. Meanwhile, the CFTC has announced a series of public roundtables to discuss market structure innovations, including digital assets.

Despite the regulatory challenges, the crypto industry continues to grow and innovate. In a recent development, the Czech National Bank Governor Aleš Michl plans to propose a strategy to allocate up to 5% of the bank's €140 billion reserves to Bitcoin. This initiative, aimed at diversifying the CNB's reserve assets, could position the CNB as the first central bank to hold Bitcoin. Michl cited the asset's potential for high returns despite its volatility and the increasing interest from major asset managers and regulatory developments in the U.S.

In other news, Scott Bessent, recently confirmed as Treasury Secretary in President Donald Trump's administration, is poised to tackle crypto regulation but will prioritize tax policies initially. Despite not focusing on crypto during his nomination hearing, Bessent is well-regarded in the digital